Zacks
0
All posts from Zacks
Zacks in Our Research. Your Success.,

The Zacks Analyst Blog Highlights: Rice Energy, Chesapeake Energy, Southwestern Energy, EQT and Cheniere Energy

For Immediate Release

Chicago, IL – July 11, 2017 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Rice Energy Inc. (NYSE: RICE Free Report ), Chesapeake Energy Corp. (NYSE: CHK Free Report ), Southwestern Energy Co. (NYSE: SWN Free Report ), EQT Corp. (NYSE: EQT Free Report ) and Cheniere Energy Inc. (NYSEMKT: LNG Free Report ).

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free .

Here are highlights from Tuesday’s Analyst Blog:

Natural Gas Plummets on Supply Data, Weather

The U.S. Energy Department's weekly inventory release showed a larger-than-expected increase in natural gas supplies following which the commodity traded down. Moreover, worries over the fuel’s tepid demand on the back of bearish weather predictions put more pressure on natural gas prices.

About the Weekly Natural Gas Storage Report

The Weekly Natural Gas Storage Report – brought out by the Energy Information Administration (EIA) every Thursday since 2002 – includes updates on natural gas market prices, the latest storage level estimates, recent weather data and other market activities or events.

The report provides an overview of the level of reserves and their movements, thereby helping investors understand the demand/supply dynamics of natural gas. It is an indicator of current gas prices and volatility that affect businesses of natural gas-weighted companies and related support plays.

Analysis of the Data: A Larger-than-Expected Rise in Storage

Stockpiles held in underground storage in the lower 48 states rose by 72 billion cubic feet (Bcf) for the week ended June 30, 2017, above the guidance (of 63 Bcf gain) as per the analysts surveyed by S&P Global Platts, a leading independent commodities and energy data provider. Worse, the increase was higher than both last year’s addition of 38 Bcf and the 5-year (2012-2016) average net injection of 66 Bcf for the reported week.

This caused the current storage level – at 2.888 trillion cubic feet (Tcf) – widen its surplus to the five-year average to 187 Bcf (6.9%), while stocks are 285 Bcf (9.0%) lower than the year-ago figure.

The bearish build in natural gas inventories created immediate selling pressure on the commodity, which tumbled 5.6% for the week to end Friday at $2.864 per MMBtu. Apart from the EIA data, the electricity generation fuel also sold off as investors took note of cooler-than-normal weather predictions (translating into lower heating gas demand) for the week ahead.

Positive Long-Term Thesis

Despite occasional hiccups, the natural gas demand situation looks promising with hot conditions set to prevail in most U.S. pockets in the later part of July and power generators burning more gas to meet intensifying cooling demand.

In any case, long-term fundamentals for the commodity continue to be supportive on the back of structural imbalances. While domestic natural gas production is expected to rebound this year, the growing use of liquefied natural gas (or LNG), booming exports to Mexico, replacing coal-fired power plants and higher demand from industrial projects will likely take care of the increased output. The resulting effect will ensure natural gas storage keeping pace with the 5-year average in the near future, with deficits piling up later on.

Over the summer, these secular tailwinds are likely to have a positive impact on natural gas sentiment and price.

Which Stocks to Bet On

The perceived price strength augurs well for natural gas-heavy upstream companies like Rice Energy Inc. (NYSE: RICE Free Report ), Chesapeake Energy Corp. (NYSE: CHK Free Report ), Southwestern Energy Co. (NYSE: SWN Free Report ) and EQT Corp. (NYSE: EQT Free Report ).

However, each of these firms has a Zacks Rank #3 (Hold), which means that investors should preferably wait for a better entry point before buying shares in them.

In case you are looking for natural gas names for your portfolio, one could opt for Cheniere Energy Inc. (NYSEMKT: LNG Free Report ). It has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here .

With domestic prices remaining constrained on the back of abundant supplies, the company sees a big opportunity in selling U.S. natural gas production at higher prices overseas. Houston, TX-based Cheniere Energy is the only liquefied natural gas exporter of the U.S. and plans to turn the commodity’s glut into export revolution, currently exporting to over 20 countries.

The 2017 Zacks Consensus Estimate for this company is for a loss of 13 cents, representing some 93.1% earnings per share growth over 2016. Next year’s average forecast is 56 cents, pointing to another 514.8% growth.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year. See these high-potential stocks free >>.

Get the full Report on RICE - FREE

Get the full Report on CHK - FREE

Get the full Report on SWN - FREE

Get the full Report on EQT - FREE

Get the full Report on LNG - FREE

Follow us on Twitter:

Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Re...

Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

support@zacks.com

https://www.zacks.com/

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Rice Energy Inc. (RICE): Free Stock Analysis Report
 
Chesapeake Energy Corporation (CHK): Free Stock Analysis Report
 
Southwestern Energy Company (SWN): Free Stock Analysis Report
 
EQT Corporation (EQT): Free Stock Analysis Report
 
Cheniere Energy, Inc. (LNG): Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research